Think like a bank

There's been a fair bit in the media in the last few days about Australia's major banks getting tough with small business. But if you, as the small business owner, can start to think like a bank, you'll have a better chance of riding out this storm.

Just business
The banking business is actually the risk management business. At the end of the day they’re lending money to you based on a risk calculation: a) can you repay the loan; b) do you have the security if you can’t repay the loan; and c) where will the money be coming from on an ongoing basis.

Increase your value
To increase your value in the bank’s eyes (so that if you do need them one day, they might listen), you can bundle a whole range of your business’ payment services, such as payroll, super, insurance and personal loans, through the one bank or lender. “If you do this, make sure you also get quotes on what you’ll pay for unbundling these services, in case you want to or have to in the future,” says Graham Godbee of the Macquarie Graduate School of Management in The Small Business Success Guide. “And get rid of any covenants: personal security and guarantees don’t do your small business any favours.”

Protect your business by thinking like a bank. It's not hard.

Margie